In September 2022 Wealthfront and UBS agreed to end a previously announced deal. The robo-advisor is one of the largest examples of an independent digital wealth management firm. It has applied to to the SEC about a proposed float on the stock market.

Wealthfront, one of the original “robo-advisors” founded in the crisis year of 2008, wants to float on the US stock market.

The firm said it has “confidentially submitted a draft registration statement on Form S-1 to the Securities and Exchange Commission relating to the proposed initial public offering of its common stock.”

While the term “robo-advisor” isn’t as widely used these days as it was more than a decade ago, the rise of businesses such as Wealthfront shows how digital technology has helped reshape wealth management in the US, and in other developed and emerging market countries. 

“After nearly two decades of growth, Wealthfront is moving towards an IPO. Wealthfront is one of the few independent robo-advisors that has stayed independent and grown to the scale needed to persist as an independent company,” David Goldstone, manager of investment research, Condor Capital Wealth Management, said in a note. 

“Wealthfront is also one of the few robo-advisors that has stuck to its pure-digital advice mission, resisting the pivot to offering access to live advisors like most of their competitors did,” Goldstone said. 

“I believe sticking with a pure-play digital advice offering while continuing to scale has helped Wealthfront reach profitability earlier than its peers,” he said. 

Wealthfront has been mulling the next stage of its development for some time. In September 2022, UBS called off its plan to acquire Wealthfront. (The deal was originally announced and reported on here.) Together, the companies decided to end their January merger agreement, valued at $1.4 billion. Instead, UBS bought a $69.7 million note convertible into Wealthfront shares.

Goldstone reflected on recent robo-advisor corporate activity, noting that IPO activity in the sector has been “minimal.” There have been some instances: SoFi went public via a special purpose acquisition company, or “SPAC” in 2021. In 2022, Acorns also planned to go public via a SPAC, but the deal did not go through.

“Wealthfront has long been a leader in the robo-advisor space and has continued to expand its product offerings. Customization of portfolio, cash accounts, self-directed trading, bond ladders, direct indexing and top-notch digital planning have all helped Wealthfront continue to grow. I am excited to see how Wealthfront continues to innovate to drive their next leg of growth,” Goldstone said.

Wealthfront said the number of shares to be offered and the price range for the proposed offering have not yet been determined. The initial public offering is expected to take place after the SEC completes its review, subject to market and other conditions, it concluded.